Why e-commerce players will have to embrace 'sell locally' strategy

Why e-commerce players will have to embrace 'sell locally' strategy

A lot has been written about e-commerce crushing the local commerce market with "mobile wave". The age of mobile has arrived and it has become the most dominating form factor for e-commerce players but, to be frank, it is not an optimal screen to carry out the e-commerce as we know it. The modus operandi looks more or less same across all big e-commerce players of the country - sell platform exclusive mobiles with pre-installed marketplace apps, market aggressively to increase app downloads, and augment email & SMS with mobile push notifications to do significant sales in addition to TV campaigns.

The competition is so intense that the biggest online retailer and biggest telecom player in the country were so interested in offering toll-free data (zero rating) platform to their mobile users in a quest to differentiate, establish and grow the mobile business model. To their surprise, the net neutrality campaigns caused untimely death of their monopolising dreams. These small experiments showcase that mobile for them is all about reach and not about disruption. That's why investors and promoters of these e-commerce plays are having sleepless nights over what is cooking in competition's kitchen.

Mobile is all about disruption. From the long queues at payphone days to the era of constant connectivity, mobile has been changing lives all along. Millions have been taken out of poverty because of mobile. And mobile data are now taking this phenomena to disproportionate levels. Remember "IIN" campaign rebranding "Internet", in reality, it infringes "Internet" "No Ullu Banoing, Sirjee".

Do you know, mobile is already a biggest local marketplace? When you call your grocery wala (since ordering grocery from mobile apps is such an "in" thing), give order and he delivers it with implied cash on delivery (or a credit register as the case may be), you are what we can call a part of mobile marketplace ecosystem.

Here is a quick fact check for the big daddies of e-commerce: Disruption in mobile is already happening on ground zero with local business owners using Whatsapp, Viber and Skype to do significant commerce. Verticals across groceries and services are mushrooming and local transactions are beginning to pivot on mobile and given the growth rate the scope is humongous and it will eventually going to redefine e-commerce in next two-three years. Move over "sell globally" to new mantra "sell locally" in digital commerce.

Some local commerce apps, with much fanfare have raised huge amounts of money with mobile only strategy, but a deeper analysis shows that they are just a new derivative of the e-commerce with a limited local supply aggregation coupled with real-time delivery. This innovation itself disrupts some existing business models but local commerce is more dynamic and complex than that. There are a lot of local businesses, both big and small, who are more entrepreneurial than the e-commerce players and their local avatars, and who can build strong networks and communities in their home territories via use of contacts, messaging, proximity, actionable analytics and still being profitable. The funny thing is, these local avatars of e-commerce will be first to be gobbled up when e-commerce wakes up to the potential of sourcing and selling locally. Interestingly, all the three major platforms are experimenting with real-time delivery in groceries in various cities.

'Sell locally' is what e-commerce will have to embrace but hope that big e-commerce players bake this in their kitchen, as someone will be quick on the toes and innovate while the big monkeys spend their time and energy on the last man standing territorial wars. But then, when are those war chests and arsenals that these biggies are building come in handy? Yes, acquisitions and acquisitions baby!

Gajinder Singh (IIT Delhi 2005 pasout) has spearheaded innovation in various payments and marketplace tech businesses in India. He is currently Founder & CEO of PayMango.com, a mobile marketplace for local commerce.